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Postal reform bill heading to Senate floor

By
Jack Moore

The Senate Homeland Security and Governmental Affairs Committee gave its stamp of
approval Thursday to a sweeping overhaul of the cash-strapped U.S. Postal Service.

In a bipartisan 9-1 vote, the committee approved the 2014 Postal Reform Act and
sent the measure to the Senate floor.

Senate progress on the bill — the brainchild of Committee Chairman Tom
Carper (D-Del.) and Tom Coburn (R-Okla.), the ranking member — has been
inching along in recent months. In August, Carper and Coburn first introduced
their bipartisan postal reform bill. But efforts to move forward with a committee
markup of the bill were delayed a number of times throughout last fall and
winter.

Finally, last week, the committee debuted a revised version of the bill that
presented a laundry list of proposals to revamp the financially troubled Postal
Service. Among the proposals are creating a Postal-only health-insurance option
within the Federal Employees Health Benefits Program (FEHBP) and a timeline for
the agency to potentially move to five-day mail delivery. The postal health plan
proposal aims to rid the agency of the need to prefund future retirees' healthcare
payments — multibillion annual payments mandated by a 2006 law that the
Postal Service has defaulted on over the past two years.

Carper said the goal for legislation is long-term solutions to the agency's
financial crunch so "that we can actually look one another and the American people
in the eye and say, 'We fixed this problem.' We haven't kicked the can down the
road. We've actually fixed this problem to put the Postal Service in a position to
go on — not just to hang on, not just to continue to twist in the wind
— but to be relevant and vibrant in the years going forward."

Thursday's vote came after hours of debate on amendments to the bill, including on
the contentious issue of setting postal rates and easing restrictions on firearms
in and near local post offices. The committee also debated amendments last week but ended that session
without a vote.

Unions object to the bill

The bill has drawn the ire of postal-employee unions, however. In a Jan. 27 letter to lawmakers, the four postal unions,
presenting a united front, objected to a new requirement that the Postal Service
shore up unfunded liabilities in the workers' compensation trust fund — to
the tune of $17 billion — which unions called "totally unfair and
unncessary" and could threaten, once again, to be a drag on the agency's
finances.

Also drawing ire is a provision allowing the agency to move to five-day delivery
if mail delivery volume falls below 140 billion pieces annually, which current
Postal Service estimates indicate would be about 2017.

The unions called the proposed mail-volume threshold "arbitrary," and would only
delay what it contends are damaging service cuts.

The bill also includes several proposed changes to the Federal Employees
Compensation Act, including cutting benefits in half for disabled workers once
they reach full retirement age. The overall rate of compensation would also be
reduced to 66.7 percent of workers' pre-injury salary for all beneficiaries.
Currently, FECA enrollees with dependents receive up to 75 percent of their salary
in benefits.

Sen. Jon Tester (D-Mont.) introduced an amendment that would only exempt the
proposed FECA changes from current FECA enrollees. However, in a vote, the
committee defeated that amendment. Last week, Tester unsuccessfully sought to
strip the proposed FECA overhaul entirely from the postal reform bill.

That National Active and Retired Federal Employees Association is urging a "no" vote on the underlying bill because of the FECA provisions.

"Changing the workers'
compensation system for the entire federal workforce has no place in a
controversial postal reform bill, and I urge members of the committee to reject
this misguided piece of legislation," NARFE President Joseph Beaudoin
said in a Feb. 6 statement.

It's unclear when the committee bill will see a vote in the full Senate.

The Republican-controlled House Oversight and Government Reform Committee passed its own version of postal reform last
July entirely along partisan lines, but it has yet to see a vote in the full
House.

Meanwhile, after two years of double-digit multibillion losses, the agency's
losses appear to have stabilized somewhat. Last year, the agency posted a $5 billion loss, but also its first growth in revenue
since 2008.

The agency is set to announce financial results for the first quarter of fiscal
2014 Friday.